Historically, Western polices have triggered China’s engagement with what is now termed the Global South. In the 19th century, Western powers made China doubt its place in the world by treating it like one of their colonies and setting up treaty ports. Chinese migrants seeking fortunes abroad found themselves rejected by xenophobia in Western countries and moved instead to the Global South.
By the early 20th century, with the Chinese Exclusion Act in force in the United States, some 60,000 Chinese migrants ended up in Mexico. Yet, despite this racism at home and abroad, some Chinese elite still hoped to emulate the West to show that China belonged to the North.
In the 1960s, isolated by the West and the Soviet Union, that thinking changed radically. For the first time, China started to claim to belong to the Global South. Through the reform era of the 1980s, China again looked on the US as an economic model. But, in the past decade, partly due to trade tensions, China has pivoted south once more. Like most developing nations, it often sees itself as a past victim of foreign exploitation.
09:30
China’s ‘gold rush’ in Mexico: why are Chinese companies investing south of the Rio Grande?
China’s ‘gold rush’ in Mexico: why are Chinese companies investing south of the Rio Grande?
With its Belt and Road Initiative, Chinese infrastructure projects have exceeded Western ones in many countries in the Global South. Yet those investments, beyond a developmental agenda, are only a means to an end; Beijing seeks to open new markets for its products, recycle its trade surpluses and fill a vacuum left by Western investors. Smaller risk appetites and a narrower agenda have often priced out Western infrastructure firms from projects such as the Vietnam to China high-speed rail connection.
But the belt and road is not only about government policies. It is also about migrants and entrepreneurs seeking economic opportunities. While countries in the Organisation for Economic Cooperation and Development remain their preferred destinations, millions of Chinese have travelled to Africa, the Middle East and South America. In Mexico for example, just like a century ago, they are rapidly becoming the second-largest migrant group.
Indeed, back in the 16th century, China was already a dominant transpacific player, exchanging its silk and porcelain for up to a third of the silver mined annually in South America. Historians regard the Spanish colony of Mexico as among the first examples of globalisation, when products from three continents were exchanged for the first time in an emerging world order where London and New York were still on the periphery.
Today, China and the West are vying for influence in the Global South. With its soft power, the West enjoys a clear dominance. But the endless wars, some seen as encouraged by the West, and increasingly xenophobic Western politicians could tilt that balance.
14:45
An unwinnable conflict? The US-China trade war, 5 years on
An unwinnable conflict? The US-China trade war, 5 years on
On the economic front, it is worth emphasising that products made in China, from mobile phones to electric vehicles, seem better suited to the mass markets of the Global South, giving China a distinct advantage.
Instances when developing nations have established trade partnerships with Western blocs show different economic outcomes. Since the EU included Eastern European countries like Poland in 2004, Warsaw’s economy has grown 4.2 per cent every year on average. But, since the 1994 North American Free Trade Agreement with the US and Canada – and the 2020 revamped trade pact that replaced it – Mexico’s economy has grown by an average of just 2 per cent annually.
While creating industrial jobs (some taken from the US), the trade agreement also displaced millions of poor Mexican farmers unable to compete against subsidised US agricultural imports, causing the Mexican population in the US to surge. Imports of US processed foods and having one of the world’s highest soda consumption rates have more than doubled Mexico’s obesity rate, adding pressure to an inadequate health system.
Fuelled by poverty and US firearms, Mexico’s organised crime grew and its homicide rate soared by 60 per cent, overtaking Brazil as one of South America’s most violent nations, while worsening the US drug crisis. In 2022, the Mexican government felt compelled to sue American gun manufacturers. This may explain why Mexico just re-elected by a landslide an anti-neoliberal and populist government.
Western and Chinese experiences in the Global South offer important lessons. Nations will not easily forget the close interplay between environmental, trade, migration and development policies. They will mark the importance of an equitable trade and investment system, and of balancing the economic benefits of globalisation with fair social policies for those displaced by it.
Simply imposing trade barriers, tariffs, walls and sanctions is not the best long-term solution for our planet. Promoting social justice at home is.
Hugo Wong, a long-time investor in China and Mexico, is the author of “America’s Lost Chinese”, a historical memoir about the rise and fall of his Chinese Mexican family in past centuries
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